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Goldman Sachs And Wisdomtree Investments Research Paper

Business Improvements Since the two companies operate in different target markets and with substantially different product mixes the recommendations must be customized for each firm. Goldman Sachs is considered a top trade recommendation for 2012 by many accounts as the firm is largely financially successful and the institutional client services dominate the businesses revenue stream (Craig, 2013). The most pressing recommendation for Goldman Sachs would be to integrate a more robust enterprise risk management system (ERM).

Risk management is becoming an important consideration for many organizations. There are several aspects to risk management that apply to Goldman Sachs and their current operating model. The 2008 financial crisis revealed many unseen sources of risk in the financial system. Although Goldman Sachs is considered to have one of the industry's best risk management systems, it stands that the company that the organization could further develop their model (Popper, 2012). Risk management is described as the practice of accounting for the potential risks that face an organization, determine what probability such exposure to risk has to the organization, and deciding how to best mitigate the various risk that is present. In many cases there is no effective way to mitigate the occurrence of various risks and the organization must instead form an action plan or a contingency plan as a response to the risk's occurrence. This...

Goldman Sachs already has systems in place for the most common financial risks due to market fluctuations. In most cases the company has contingency plan already in place so that they can respond quickly to the risk. By reducing the time it takes to both identify and respond to the risk can also reduce the severity of the risk's potential influence upon the organization. However, the modern economy has a whole set of risks that have not been as prevalent in the past. These include such items as systemic financial risk, environmental risks, and political risks. Therefore, Goldman Sachs should continue developing risk screening tools as well as a comprehensive contingency plan to better forecast more modern risks. The ability to respond quickly to the occurrence of risks can be the organization's strongest defense against risk.
The recommendations for Wisdom Tree should include further diversifying the product mix. Wisdom Tree's financial services were rather target compared to the more diversified product mix such as the one offered by Goldman Sachs. WisdomTree is the only publicly-traded pure play ETF sponsor and the…

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Works Cited

Craig, S. (2013, January 16). Bolstered by Investments, Goldman Sachs's Profit Soars. Retrieved from Deal Book: http://dealbook.nytimes.com/2013/01/16/goldman-profit-soars-to-2-89-billion-in-4th-quarter/

Janus. (N.d.). Investor Newsletter. Retrieved from Janus: https://ww4.janus.com/Janus/Retail/StaticPage?jsp=jsp/Common/JanusReportHTML.jsp&assetname=JanusReportDealingMarket

Popper, M. (2012, October 9). Who's the Best on Wall Street: Risk Management Report Card. Retrieved from CNBC: http://www.cnbc.com/id/49328094

Steinberg, J. (2013, March 5). WisdomTree Investments' CEO Presents at Citigroup U.S. Financial Services Conference (Transcript). Retrieved from Seeking Alpha: http://seekingalpha.com/article/1249151-wisdomtree-investments-ceo-presents-at-citigroup-us-financial-services-conference-transcript
Steinburg, J. (2012, April 27). WisdomTree Announces First Quarter 2012 Results. Retrieved from Wisdom Tree: http://ir.wisdomtree.com/releasedetail.cfm?ReleaseID=667989
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